CBRE 3Q16 Earnings Call Notes

posted in: Notes | 0

CBRE Group’s (CBG) CEO Bob Sulentic on Q3 2016 Results

There’s activity but compared to last year it’s muted

“I would say around the world, it’s kind of what I said earlier, Brandon. There is significant activity, but against the backdrop from last year where we and the market grew dramatically. It seems fairly muted. We expect there to continue to be solid activity. We expect there to be job growth, kind of like the job growth we had so far this year. But there is uncertainty in the marketplace which is putting pressure on the results relative to what they were a year ago.”

Jim Groch

Still seeing bids but seen number decline on largest deals

“Yes, Jade, this is Jim. We are seeing in our system where we track number of folks that are signing nondisclosure agreements per deal, that’s remained pretty steady and at a high number, kind of in the upper 50s per deal of people that have seen it, reviewed the teaser, and come in and signed a full nondisclosure agreement, so with a real interest. That’s held pretty steady. We have seen days on the market increase a bit, let’s say, maybe 10% or so. So we have seen a little more caution as the years played out…Still pretty strong in general, but on the largest deals you’re seeing the number decline, on very large transactions.

Our own capital raising has been very strong, but there has been some pressure for the industry

“Our own capital raising was a very, very strong quarter; a very strong trailing 12 months for our own business. But capital raising overall with the industry has been under some pressure. It still feels like there’s a fair amount of liquidity there on the market.”

UK team believes that activity could pick up now

“Yes, we think that our leaders in the UK tell us that they believe that there is a reasonable chance that activity will pick up now. Obviously, there is real uncertainty there over this issue of hard Brexit and will that happen or won’t it and what will the implications of that be. But we have some hope that there will be a pickup between now and the end of the year.”